Help to Buy is a government scheme that aims to help first-time buyers get onto the property ladder. It was designed to help those who need it most i.e. buyers who would otherwise be unable to access affordable mortgages due to having insufficient deposits.
Please note you can no longer apply for a Help to Buy: Equity Loan.
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If you have bought a home using the Help to Buy scheme, you will not pay interest on the loan for the first five years. Equity loans from Help to Buy normally have a term of 25 years, by which time the loan must be repaid in full.
Alternatively, you may wish to pay off the equity loan amount sooner, switch to a different mortgage deal, or sell the property. When this time comes, the amount you must repay is worked out as a percentage of the property’s current market value.
Therefore, before making a redemption payment, the government requires you to obtain an independent valuation from a RICS registered valuer, such as those who work for SDL Surveying (please note this is not the same as a lender’s mortgage valuation). Our valuer’s report will determine the current market value of your home, which will form a basis for calculating the amount you must repay.
If the value of your property has decreased, then the amount you must repay may be less than you originally borrowed. However, if the value of your home has increased, the amount you must repay may also have risen.
When you have obtained a Help to Buy valuation from an accredited RICS surveyor, you must send a copy of the valuation report to Target who have been appointed by the government to administer the scheme. Target will then advise you on the amount you must repay.
Please note that your Help to Buy valuation will only be valid for 3 months. Therefore, it’s crucial to plan your timings carefully so that you obtain the valuation report near to time of your sale or re-mortgage process being completed. It may be possible to update the Help to Buy valuation, but this may incur additional cost.
How much could a Help To Buy Mortgage Valuation Cost?
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When reviewing your mortgage application, your lender may enlist the specialist advice of a RICS Valuer to help them decide how to fund the property you are buying, or remortgaging. At SDL Surveying, we are instructed to provide valuations for a range of national lending organisations.